Paying by debit or credit card is second nature these days. Rarely do most of us carry cash unless we have an explicit reason – and each time we're unable to buy something because a business doesn't take cards (namely, our favourite lunchtime food pop-up), we're reminded of how much we rely on our credit and debit cards.
Which is why we're over the moon about the news that, from January 2018, we'll no longer be charged extra for paying by debit or credit card either online or in-store, the BBC reported. Currently, big businesses like airlines and food delivery apps, as well as many smaller businesses, charge consumers extra for paying by card, which was news to us.
At the moment, large retailers are charged between 10p and 20p by banks for each transaction made by debit card and 0.6% for credit cards. Travellers booking airline tickets with credit cards currently pay an extra 3% with Flybe when they spend at least £5, for example, while Ryanair and Norwegian customers are charged an extra 2%, reported the BBC.
The change means these charges will no longer be legal and some airlines have already cut their charges over the last year, including British Airways and Monarch.
Takeaway food apps also make a mint from charging customers to pay by credit and debit cards, the government said. It turns out that Hungry House and Just Eat often add an extra 50p to your bill unless the cost is picked up by the restaurant. If you're paying by credit, this means a £10 bill would result in a 5% charge.
The European Union already bans Visa and Mastercard surcharges, but the UK will also be prohibiting charges on American Express, Paypal and Apple Pay as well, in a move that's being celebrated by consumer rights campaigners.
Guy Anker, managing editor of consumer website MoneySavingExpert.com, welcomed the news but said it will likely encourage some companies to simply increase their prices to cover the cost of card payments.
He said that while "it will make it easier for consumers to compare prices," because the headline price of goods and services will be clearer, "we expect some companies will raise prices for all to compensate for the loss, which could hit those who currently pay in cash or debit card." Given the increased transparency the move will foster, it's at least a step in the right direction.